Paper short abstract:

Generating decent employment plays a key role in the creation of a new social contract and social cohesion. The crucial question is thus, how to create more decent jobs in Africa? We examine the role of patient (long-term) capital in creating decent jobs and diffusion of social standards.

Paper long abstract:

Generating decent employment plays a key role in the creation of a new social contract and social cohesion. The crucial question is thus, how to create more decent jobs in Africa? Much of the extant research has focused on the role of two types of actors in shaping employment relations in developing countries, namely the state and its adoption, implementation and enforcement of policies to create decent jobs, and the role of the businesses in employment relations. In this paper, we draw attention to a third type of actor that has been largely absent in the literature on the determinants of employment relations in developing countries, namely the role of financial institutions. Based on data from 38 interviews of Kenyan manufacturing firms, financiers, and labour representatives before and during the Covid 19 pandemic, we examine the relationship between the patience of capital and labour relations. In particular, the evidence presented in this paper suggests that access to more patient sources of capital may help to enhance the quantity and quality of jobs in African countries. We discuss three mechanisms through which this occurs including diffusion of social standards on decent work. Our paper contributes to a broader literature on patient capital which largely focuses on developed countries by extending it to the context of lower income African countries and speaks to broader debates about how to enhance the contribution of finance capital to social cohesion.